Royals’ Moore says team’s payroll of $90 million is past break-even point

Kansas City Star | Feb 12

The door closed on a reunion between the Royals and right-hander Ervin Santana about two weeks ago. Shortly before the organization reached a one-year agreement with left-hander Bruce Chen, general manager Dayton Moore reached out to the representatives for Santana, who flourished for the team in 2013. Moore found the tenor of the conversation between the team and the player had not much changed.

“Their expectations were more than we were willing to give,” Moore said.

The door was never open that wide, Moore insisted on Monday afternoon. The organization made that determination after the season. They instead opted for a four-year, $32 million deal with Jason Vargas, while Santana has languished on the stagnant free-agent market.

Barring a stunning, last-minute reversal, Santana will pitch elsewhere in 2014. After a winter spent waiting for suitors, he appears to be closing in on signing with a club, Fox Sports reported on Monday. The candidates include Baltimore and Toronto. The Royals have bowed out of the conversation.

The organization harbors some concern about the durability of any 31-year-old pitcher entering a multi-year contract, Moore said. In addition, there is the financial consideration. Santana already rejected the team’s one-year, $14.1 million qualifying offer.

Moore indicated the club’s payroll should surpass $90 million in 2014, about a $9 million increase from last season’s record-breaking Opening Day amount and a sum that exceeded their budget for this season. Moore declined to provide the specifics on the initial payroll goal, but he referred to this season as a “gamble.”

“I know what our break-even point is,” Moore said after a news conference preparing for the beginning of spring training this Friday. “We’re beyond that at this point in time. Hopefully we have a great year, and we’re able to create a lot of interest with this team, and people show up at the ballpark. And hopefully the gamble pays off economically.”

Last year, the Royals spent about $7 million less in payroll, $83 million, and had an operating income of $16.3 million, according to Forbes. Operating income does not reflect a company's net profit or bottom line, which is calculated after taxes, depreciation and other expenses. In 2012, Forbes reported the Royals spent $69 million on payroll and had an operating income of $28.7 million.